Bitcoin price could easily slide 7%, but will BTC bulls sit by idly?

Bitcoin price has slipped below the ascending parallel channel setup, denoting a breakout.
BTC could retest the four-hour EMA and SMA at $22,861 and $23,199, respectively, before sinking to $21,286.
Invalidation of the bullish thesis would involve a flip of the four-hour SMA at $23,199 into a support floor.

Akash Girimath FXStreet

Bitcoin (BTC) price shows a clear sign of consolidation below the long-term consolidation structure. While the bearish outlook has not yet been confirmed, bulls should not rest, knowing that another crash could occur soon.

Also Read: Shiba Inu price could crash to December 2022 lows if it loses this level

Bitcoin price continues to tighten

Bitcoin price has been in a rangebound movement since the Silvergate crisis-led crash on March 2. This sudden sell-off has knocked BTC below the ascending parallel structure seen in the chart below.

While a breakdown of this structure forecasts waning bullishness and even a bearish move, more confirmation is required. In the meantime, market participants can expect Bitcoin price to trigger a recovery rally that tags the four-hour Exponential and Simple Moving Averages (EMA, SMA) at $22,861 and $23,199, respectively.

A rejection here will be the first step for bears to seize control. A swift spike in selling pressure could collapse Bitcoin price to the next key support level at $21,625. In some cases, this move could wick down to the 200-day EMA support at $21,268.

Bitcoin price could tag the 200-day SMA at $19,716 in a worst-case scenario.

BTC/USDT 1-day chart

On the other hand, if the recovery bounce causes Bitcoin price to produce a daily candlestick close above the $23,199 hurdle into a support floor, it would invalidate the bearish thesis. However, investors should wait for a secondary confirmation, which will arrive after BTC flips the $25,000 psychological level into a foothold.

In such a case, Bitcoin price could eye the next major hurdle at $28,000.

Author

Akash Girimath

FXStreet

Akash Girimath is a Mechanical Engineer interested in the chaos of the financial markets. Trying to make sense of this convoluted yet fascinating space, he switched his engineering job to become a crypto reporter and analyst.

Markets move fast. We move first.

Orange Juice Newsletter brings you expert driven insights - not headlines. Every day on your inbox.

Editor's Picks

Dogecoin ticks lower as low Open Interest, funding rate weigh on buyers

Dogecoin extends its decline as risk-off sentiment dominates across the crypto market. DOGE’s derivatives market remains weak amid suppressed futures Open Interest and perpetual funding rate.

Crypto Today: Bitcoin, Ethereum, XRP decline as risk-off sentiment escalates

Bitcoin remains under pressure, trading above the $87,000 support at the time of writing on Tuesday. Selling pressure has continued to weigh on the broader cryptocurrency market since Monday, triggering declines across altcoins, including Ethereum and Ripple.